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Due to its affordable market, Sharjah has become a refuge for residents escaping the rising residential rents in Dubai and for people from countries across the region that are currently experiencing political instability. This continued on for many years until recently when rents in the same emirate became a cause for concern among tenants. The situation is further exacerbated by the limited supply available in the market, and the rising population spurred by its improved aviation sector and the massive options of international schools in the area.
A news report revealed that rental increases have shot up to 40 percent in popular locations across Sharjah in the first quarter of 2014, and that this trend is forecast to continue in the coming months. The same report mentioned that the areas of Al Wahda, Mina and Al Nahda witnessed increases of 11 percent at the end of the first quarter. Old residential buildings have also reported rental hikes of 6 percent, and that developments in Al Taawun and Al Nahda now have asking rates similar to Dubai’s International City and Dubai Silicon Oasis. However, residential accommodation in Sharjah is still cheaper compared to Dubai.
Because of Sharjah’s current overall status, tenant complaints filed at Sharjah Municipality’s rental dispute committee are also on the rise. Tenants generally complain of unreasonable rent hikes during renewal, and landlords not offering maintenance services. Rental laws in Sharjah do not allow landlords to increase rents within three years of the contract. However, a particular research firm’s study showed that some landlords resort to other tactics to collect money from tenants by asking for additional fees for extra parking areas and maintenance. But another research firm also said that there is a handful of landlords who choose not to flout the rent laws.
With the surge of demand for residential stock, developers are now starting to train their eyes on Sharjah. There is a heightened interest for developing mixed-use communities that can compete with other communities in Dubai and Abu Dhabi.
But as long as the “flight to affordability” continues and the demand is not met, rent prices will remain high.
• Sharjah’s residential rents have increased up to 40 percent in popular locations
• Al Taawun and Al Nahda report asking rates similar to some Dubai communities
• Many developers expressed interest in launching mixed-use projects in Sharjah
Source: Ellen Joyce Soriano, Special to Properties
The writer is a freelancer